Behavioral biometrics analyzes a user’s digital physical and cognitive behavior to distinguish between cybercriminal activity and legitimate customers, identifying fraud and identity theft. Actual customers and fraudsters interact with digital platforms differently. For example, while you might enter information one key at a time, criminals are more likely to copy and paste their way through a form. This analysis is more complex than it sounds, but the main takeaway is that behavioral data can provide insights into fraudulent activity.

Behavioral biometrics leverages machine learning to analyze patterns in human activity and detect whether someone really is who they claim to be when they interact online and whether the activity is driven by a human or part of an automated attack.

A key benefit of behavioral biometrics is that it works passively in the background of a user's web or mobile session to monitor thousands of parameters, such as how a person holds their phone or how they scroll or toggle between fields, thereby minimizing friction in the user experience. Whether as a standalone solution or as part of a layered fraud management plan, behavioral biometrics is delivering extraordinary results and exposing the most advanced fraud attacks.

Why Do We Need Behavioral Biometrics?

The need for behavioral biometrics arises from the increasing ease with which cybercriminals can find, steal, or purchase personal data such as email addresses, phone numbers, birth dates, and other personally identifiable information to gain access to or open fraudulent accounts. Additionally, the use of malware, remote access tools, and other technologies by cybercriminals has exposed the weaknesses of traditional authentication tools like passwords, device IDs, and one-time passcodes. Despite existing controls, the fraud problem is so severe that it has prompted high-level governmental intervention.

Fraud is a significant problem for financial institutions. Seniors are scammed out of $3 billion dollars every year; there has been a 78% increase in mule activity for account holders under age 21; American banks alone lost $3.5 billion dollars to application fraud in 2021 and $6 billion dollars to account takeover in 2020; and the UK lost £479 million to authorized push payment fraud the same year. As digital and mobile banking has revolutionized the financial industry, it has also provided more opportunities for criminals to attempt fraud.

The rising numbers indicate that controls like activity monitoring and device identification aren’t enough to stop cybercriminals. However, the adoption of newer, more efficient methods like behavioral biometrics is helping to track down cybercriminals more effectively.

Defending Digital Banking Sessions with Behavioral Biometrics

Behavioral biometrics can be implemented across various industries with a digital presence and are poised to play a major role in building digital trust and safety. Financial institutions have been among the first to adopt the technology and are seeing game-changing successes.

Digital banking has become the single most effective channel for financial institutions to drive growth, increase revenue, and attract new customers. However, financial institutions face the challenge of pursuing innovation in digital channels while maintaining strong fraud management and risk controls. Traditional remedies have fallen short, but the introduction of behavioral biometrics technology offers a powerful tool for tackling advanced threats while enabling innovation and growth.

As digital banking and payments continue to accelerate, financial institutions can leverage behavioral biometrics to meet their fraud management and digital business goals. The technology shifts the emphasis to user experience, allowing institutions to pursue their digital growth objectives while effectively managing fraud.

Behavior Tells All: Examples of Behavioral Biometrics Use Cases

Account Opening Protection: When New Customers Are Not

In a 2020 study conducted by the FTC, there was an 88% increase in new credit card accounts activated and a 33% increase in new bank accounts opened through identity theft compared to the previous year. The opening of fraudulent accounts is a serious problem, costing banks time and money and requiring additional security measures that can hurt the customer experience. Behavioral biometrics technology can help banks trust new customers by analyzing typing speed, swipe patterns, and every click of the mouse during the account opening process.

In one case, a top-5 U.S. card issuer realized a $10 million annual uplift by deploying behavioral biometrics in their account opening process. The issuer gained a new layer of visibility that enabled them to differentiate between legitimate applicants and cybercriminals, allowing them to accept more applications with greater confidence.

Account Takeover Protection: Before Cash Disappears

Account takeover fraud is a top concern for financial institutions, with scammers using malware, automated attacks, social engineering, and other methods to take over user accounts. Behavioral biometrics prevents account takeover through continuous monitoring that verifies the user’s identity throughout a session. This visibility into the entire session allows financial institutions to stop fraudulent transfers before they occur.

One financial institution was able to stop a £1.6 million fraudulent transaction in real-time, while a top bank in Asia used behavioral biometrics to prevent more than 90% of fraudulent payments before they occurred.

Social Engineering Scam Detection: Who’s Really on the Line?

Social engineering scams leverage human psychology to appear legitimate and trick victims into providing important details or transferring money. Behavioral biometrics provides a window into a scam in progress and can stop it right in its tracks. By analyzing differences in digital behavior, behavioral biometrics can detect when a user is acting under duress or the coercion of a cybercriminal.

For example, behavioral biometrics helped one UK bank save £500K per month in fraud losses by detecting real-time social engineering scams in action.

Mule Account Detection: Finding the Go-Betweens

Money mules move money from one bank account to another for illegal purposes and are a critical part of fraud, scam, and identity theft operations. Recent developments in behavioral biometrics have presented a reliable solution for mule account detection. By analyzing mule activity patterns, behavioral biometrics can flag suspicious transactions and detect mules whenever they commit fraudulent activity.

This approach helps to efficiently identify and stop the individuals wreaking havoc on financial institutions without invasive or privacy-infringing data collection.

Create a World of Trust and Ease

The role of digital services in our lives has never been more essential. From banking and shopping to how we work and learn, the most routine activities we do every day are taking place online. Organizations must build trust with customers and eliminate friction in digital interactions.

Behavioral biometrics offers a promising solution to these challenges, enabling organizations to meet their fraud management and digital business goals while maintaining a smooth and secure user experience. As digital services continue to expand, behavioral biometrics will play a crucial role in ensuring trust and safety in our digital interactions.